Title
Audit Committees, Corporate Governance, And Shareholder Wealth: Evidence From Korea
Abstract
This paper examines the effect of audit committee appointments on shareholder wealth in Korea after the Asian financial crisis. We find that stock prices generally increase with audit committee appointments. In contrast, chaebol (business group) affiliates and firms switching audit committee membership are associated with significantly lower stock returns, probably due to the management's opportunistic behavior. However, the independence and financial literacy of the audit committee members appear to mitigate the opportunistic behavior. Therefore, our result confirms that the characteristics of the audit committee strengthen or weaken the existing corporate governance. We discuss the implications of our results obtained under Korea's unique corporate governance structure.
Publication Date
1-1-2014
Publication Title
Journal of Accounting and Public Policy
Volume
33
Issue
5
Number of Pages
470-489
Document Type
Article
Personal Identifier
scopus
DOI Link
https://doi.org/10.1016/j.jaccpubpol.2014.06.001
Copyright Status
Unknown
Socpus ID
84922398607 (Scopus)
Source API URL
https://api.elsevier.com/content/abstract/scopus_id/84922398607
STARS Citation
Choi, Yoon K.; Han, Seung Hun; and Lee, Sangwon, "Audit Committees, Corporate Governance, And Shareholder Wealth: Evidence From Korea" (2014). Scopus Export 2010-2014. 9373.
https://stars.library.ucf.edu/scopus2010/9373